Thailand new hub for auto industry

[Trembly]

The use of the word "hub" for Thailand is driving me crazy.

I think the writers need to get a thesaurus.

Here let me help:

More words related to hub

center

noun. middle point

axis

bull's-eye

centrality

centriole

centrum

core

cynosure

equidistance

essence

focal point

focus

gist

heart

hotbed

hub

inside

interior

intermediacy

kernel

mainstream

marrow

middle of the road

midpoint

midst

nave

navel

nucleus

omphalos

pith

pivot

place

polestar

quick

radial point

root

seat

Yeah I like the world "omphalos". Lets have Thailand be the belly button of the auto industry for a change.

Most of the words on that list are inappropriate - I don't know if you are a native English speaker, but the problem with English is that as we are a German based language with another 50% or coming from other Languages - Latin-based mostly - as a result we have ended up with a massive amount of apparent synonyms.

The problem here is that these synonyms aren't actually always interchangeable; they convey different shades of meaning, subtexts, collocations and uses.

So what you really need to do is rather than just cut and paste a list from a Thesaurus, is look for alternative words that would fit and still coney the same meaning.

actually quite a pointless task, would you car to select some others that you think would be apt?

"Omphalos" is great - do you think it will catch on?

"Omfalot"

[Tomtomtom69]

Thailand is already the 9th largest motor industry in the world, exceeding such countries as Spain, France and UK.

They don't just assemble vehicles, they have a large industry that manufactures the parts here in Thailand.

Initially Thailand produced "labor intensive" models as it could supply cheap semi-skilled labor.....that is changing and in the future they need to develop the more "hi-tech" production side of the industry, which requires higher skills and wages but less staff.

Labor costs are not everything of course...PRODUCTIVITY is other factor - high productivity can support higher wages but is likely to demand less workers.

PRODUCT is of course important and many industries have scolloped because they don't have a marketable/sellable/desirable product.

The Australia market is not very big and already being supplied by Thailand.....so to increase exports here will require models to replace Holden, Ford and Toyota who were manufacturing rather large vehicles not sellable anywhere else.

I'd say that Toyota are in the best position here as they know that market very well and have the resources to target it with suitable models.

I think there are a lot of posters on TV who have no idea of the size of Thailand's industrial base......all they need to do is take a trip around Chonburi and Rayong provinces and they will see how massive it is.....in short they need to get out more

Actually, the Australian market is the same size as Thailand's judging by the number of new vehicles sales. Both countries managed about 1.2 million sales last year. Thailand does however have almost 3 times the population (23 million in Australia vs. 67 million in Thailand) but not yet 3 times the number of sales just yet. The only difference is that Australia's local vehicle manufacturing output has been far lower than Thailand's in recent years, not least due to very different ways of protecting their automotive industries - also, the vast majority of new vehicle sales in Australia in recent years have been imported vehicles, in Thailand's case it's the exact opposite. In 2012, just 200,000 odd vehicles were produced in Australia, whereas Thailand managed about ten times that number, at 2 million. Back in 2005, already well over a million were produced in Thailand and 394,000 in Australia, a reasonable figure that unfortunately dropped to half that level only 7 years later. But it's quite obvious why that has happened, sad as it is.

80-90% of parts used in Thai pickups are locally manufactured, and about 70% for passenger cars. The Thai government also has disincentives for companies like Mercedes to manufacture their CKD vehicles using imported parts - the tax rates are much higher than for Japanese models produced using mostly local parts.

I agree that productivity is a big issue in the automotive industry and relatively low wages alone hardly explain Thailand's success. In fact, as you say, wages will continue to increase but so will productivity and fewer workers will be needed. I see a good future for Thailand's automotive industry to take advantage of that, which can hopefully have the overall effect of increasing productivity and efficiency in other sectors of the economy too. I see it as being a potential stepping stone towards Thailand having the potential towards becoming a more developed nation.

Edited March 31, 2014 by Tomtomtom69

[BadBouy]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

I was wondering why Germany and Japan were building cars in the US, and all because of you I know why "slave wages"

[ginjag]

The use of the word "hub" for Thailand is driving me crazy.

I think the writers need to get a thesaurus.

Here let me help:

More words related to hub

center

noun. middle point

axis

bull's-eye

centrality

centriole

centrum

core

cynosure

equidistance

essence

focal point

focus

gist

heart

hotbed

hub

inside

interior

intermediacy

kernel

mainstream

marrow

middle of the road

midpoint

midst

nave

navel

nucleus

omphalos

pith

pivot

place

polestar

quick

radial point

root

seat

Yeah I like the world "omphalos". Lets have Thailand be the belly button of the auto industry for a change.

Most of the words on that list are inappropriate - I don't know if you are a native English speaker, but the problem with English is that as we are a German based language with another 50% or coming from other Languages - Latin-based mostly - as a result we have ended up with a massive amount of apparent synonyms.

The problem here is that these synonyms aren't actually always interchangeable; they convey different shades of meaning, subtexts, collocations and uses.

So what you really need to do is rather than just cut and paste a list from a Thesaurus, is look for alternative words that would fit and still coney the same meaning.

actually quite a pointless task, would you car to select some others that you think would be apt?

"Omphalos" is great - do you think it will catch on?

Good to know English is the hub of languages.

China could be the auto manufacturing hub if it wasn't for quality issues.

If Great Wall, for example, started manufacturing in Thailand then look out.

China do not have quality issues - look at the stuff they make for sale in the west.......if you specify quality in China, you get it,,,,,,if you specify crap...that's what you get.

As far as their motor cars are concerned - they are behind in design and technology on their own, but it will only be a mater of a few years before they storm the world market with their own products. they are getting plenty of practice building for the west already.

They have very good cars in China. Chery A111 small eco before the eco in Thailand, I had one, remote door locks LED lighting, PAS-Air Bag- alloys-electric windows-Leather seats-mp3/4/cd-trip-fuellitre check when driving every given extra---components/engine--included Bosch-and the like.

I locked myself out of the car--tried to smash the side window to get access with a large hammer and the glass never gave way only scratched it.

This car was 470,000 bht new I never had a problem. now have changed but miss this roomy small car.

are not Lotus-BMW-and the like there already???

[wilcopops]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

Cheaper labour, but cars are still more expensive in Thailand than say Australia.

True - but that's largely a result of Australian government policy to remove duties and tariffs, such that imported models became so cheap that they undercut the price of the locally produced Australian models. Not only that, but consumers' increasing preferences for smaller, more fuel-efficient models that the Australian manufacturers (or their bosses) never decided to manufacture and an unfair Thai-Australia FTA, where Thai exporters are able to export Thai made Japanese vehicles to Australia at 0% duty (prior to the agreement I think the duties were only 5% or something fairly low like that) whereas Australian imported cars are still subject to up to 300% duties, even if the "import duties on Australian cars" "disappeared". So as you can see all these factors resulted in the Australian industry dying and Thailand's industry continuing to show strength mainly because of Thailand's highly protective automotive market policies. If Thailand followed Australia's lead, I'm quite sure that the Thai automobile industry would become unviable too - and exactly because of this, don't expect the 300% duties on foreign imported automobiles (and similarly quite high duties on CKD vehicles built in Thailand using imported parts such as some Mercedes models) to be removed anytime soon - lowered somewhat, perhaps, but eliminated entirely, not for years or decades, I'd say.

I can't explain why locally produced Thai cars for the Thai market are more expensive than their equivalents in Australia, North America and other countries though, other than the Thai government taxes them higher in order to prevent too many people owning a car and clogging up the roads even further? You might say this contradicts the government's previous policy relating to the tax rebate scheme in 2012, but I think the extra income for the government is both lucrative and a way of slowing down unsustainable growth in the automotive market, which would lead to even more congested roads.

Australia's population is 1/3 that of Thailand and has more than 15 times the land area. That means it has at least 45 times fewer people per sq km than Thailand and additionally, in the cities there is far more road space for vehicles than in Thailand - in Bangkok just 8% of city area is dedicated to roads yet 25% is required. I haven't seen the statistics for Sydney for example, but I'm quite sure it's around 25% - there are simply far more roads, including both main roads, connecting roads and residential streets, than in Bangkok. I'd be quite happy for the authorities to purchase half of say Nana, bulldoze the sh**hole and build some major connecting roads through there (perhaps also another expressway link or a skytrain-airport link connection), leaving some space for upper class hotels and/or condominiums, but unfortunately pimps, drug dealers and sleaziness are likely to remain in that area for now. In Thailand, while road widening is common in the provinces and various expressway "missing links" have been built over the years, I see absolutely no evidence of new road building. Of course, most new road construction would take place on the outskirts of the city where there's more room. I live on the outskirts of Bangkok, but nothing has changed - no new roads. Only at most, the addition of a new lane in each direction for a few km. That's a bandaid solution, not a real solution.

What you mean is the Aussie industry could not compete without protectionist duties that made normal cars so much better value.

[wilcopops]

Don't know where you get your figures from...but my sources say Australia made about 200000 vehicles and Thailand about 1.5 million.

[wilcopops]

The use of the word "hub" for Thailand is driving me crazy.

I think the writers need to get a thesaurus.

Here let me help:

More words related to hub

center

noun. middle point

axis

bull's-eye

centrality

centriole

centrum

core

cynosure

equidistance

essence

focal point

focus

gist

heart

hotbed

hub

inside

interior

intermediacy

kernel

mainstream

marrow

middle of the road

midpoint

midst

nave

navel

nucleus

omphalos

pith

pivot

place

polestar

quick

radial point

root

seat

Yeah I like the world "omphalos". Lets have Thailand be the belly button of the auto industry for a change.

Most of the words on that list are inappropriate - I don't know if you are a native English speaker, but the problem with English is that as we are a German based language with another 50% or coming from other Languages - Latin-based mostly - as a result we have ended up with a massive amount of apparent synonyms.

The problem here is that these synonyms aren't actually always interchangeable; they convey different shades of meaning, subtexts, collocations and uses.

So what you really need to do is rather than just cut and paste a list from a Thesaurus, is look for alternative words that would fit and still coney the same meaning.

actually quite a pointless task, would you car to select some others that you think would be apt?

"Omphalos" is great - do you think it will catch on?

Good to know English is the hub of languages.

China could be the auto manufacturing hub if it wasn't for quality issues.

If Great Wall, for example, started manufacturing in Thailand then look out.

China do not have quality issues - look at the stuff they make for sale in the west.......if you specify quality in China, you get it,,,,,,if you specify crap...that's what you get.

As far as their motor cars are concerned - they are behind in design and technology on their own, but it will only be a mater of a few years before they storm the world market with their own products. they are getting plenty of practice building for the west already.

They have very good cars in China. Chery A111 small eco before the eco in Thailand, I had one, remote door locks LED lighting, PAS-Air Bag- alloys-electric windows-Leather seats-mp3/4/cd-trip-fuellitre check when driving every given extra---components/engine--included Bosch-and the like.

I locked myself out of the car--tried to smash the side window to get access with a large hammer and the glass never gave way only scratched it.

This car was 470,000 bht new I never had a problem. now have changed but miss this roomy small car.

are not Lotus-BMW-and the like there already???

GM are there big time....but the home produced models are to say the least dated....... You can only cover up so much with nail-on goodies. That's not it to say they aren't catching up rapidly.

[thaiguzzi]

I see, I hit a nerve in a few "Fatcats" ;-)

Mmm..you are telling me that companies like Merzedez are not exporting parts and/or vehicles to Europe from Thailand?

Or how about Motorcycle manufacturers such as Triumph, who produce here and then ship them to Britain?

I still need so see actual figures of wages and benefits for Thai Auto workers. (I am not talking upper management, I am talking wages of the average production worker in the Thai plants.

I love it when people try to justify their own greed.

No, Mercedes does not export back to Europe.

No, Triumph do not build a complete bike and ship it back to Britain.

More studying before posting. Google the facts.

[wilcopops]

Don't know where you get your figures from...but my sources say Australia made about 200000 vehicles and Thailand about 1.5 million.

Sorry misread the other post - he was talking about sales not manufacturing.

the two markets BUY about the same number of units.

The difference being that whilst the Aussie market is at saturation point the Thai market is still largely an "equipment" market in economic terms.

Only 10% of the Oz market is built in Oz.....conclusion....it isn't PRICE so much as PRODUCT, whereas a meaty V8 sedan, wagon or Ute is a great dream to have, when faced with reality most customers want a smaller, more economical unit....even SUVs are competing with pickups etc made in Thailand.

like the US Oz failed to make the change from big to economy and ended up with nothing to export.....so they've given up.

I have to add that I have owned both Fords Flacons and Fairlaines and Holdens various commodores, in Oz and was appalled by the build quality on the later models. People who wanted a "larger" car were opting for Magnums and then Toyotas in their droves....

[Old Man River]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

[wilcopops]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

NKK - Firstly I'd check the sources.

Then I'd look at the commitments of Japanese businesses in Thailand.

then I'd compare the situation here to Australia where they ARE pulling out.

then I'd ask where will they go?

There are options of course, but weighed against the drawbacks, I rethink it is a very unlikely scenario......more a case of media making mountains out of molehills.

Edited March 31, 2014 by wilcopops

[getthaid]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

Yes those pesky western manufacturers. Mazda. Honda, Toyota...... Er....maybe a re-read of the op might be advised.

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Edited March 31, 2014 by getthaid

[NongKhaiKid]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

Only that Toyota has said that if the unrest in Thailand doesn't settle down within 6 months they will shelf a massive development project and if the situation still exists in a year they will likely move elsewhere in Asia.

isn't the unrest caused by politics ?

[Thai at Heart]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

You really have absolutely no idea about the automobile manufacturing industry in Thailand, do you ? The safety standards within these factories are on a par with those in the West and the wages, especially for those with a marketable skill are exceptionally good. Even the run of the mill production line operator has a fair salary, very good bonus and benefits that exceed anything they could get by working at the majority of local companies.

The statement is generally true though. We used to build cars in the UK but we can't any more becuase of the property prices. 70% of the UK land owned by less than 1%. As long as they're getting their rent they don't care if all industry just stops in the UK. and manufacturing moves to Asia. The UK needs land reform or at least land taxes.

In the bigger picture this statement is true. Its why our politicians want to push for EU membership so the 1% can profit from free market. While the country goes bust.

Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

Huh?

Of all the heavy industry in the UK, automotive is amazingly strong in the UK. Rolls Royce, Bentley, jaguar, mini, Toyota, Honda, Nissan, caterpillar, JCB, formula one.

An amazing stat the other day is that of all r&d globally on cars, the UK gets 20%. They make gearboxes, engine blocks and electrics for distribution for many global manufacturers in the UK.

Its only in the last few years that Thailand overtook the UK even.

[expat888]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

You really have absolutely no idea about the automobile manufacturing industry in Thailand, do you ? The safety standards within these factories are on a par with those in the West and the wages, especially for those with a marketable skill are exceptionally good. Even the run of the mill production line operator has a fair salary, very good bonus and benefits that exceed anything they could get by working at the majority of local companies.

Holy crap what propaganda!! "...marketable skill are exceptionally good." Maybe we are talking about 2 different countries because that ain't Thailand.

Just the fact that a car was assembled in Thailand should trouble a potential buyer. I only hope none of the parts were made here.

Everything I have bought that was made in Thailand broke within 3 months.

I don't see anything wrong with Thai produced foreign vehicles (well all of them are as there are no local Thai brands. Thairung was the closest to being a local brand but what happened to them?) However, it's interesting to note the attitude towards Thai products amongst consumers in neighboring Laos, long the country with by far the highest share of Thai imports (66% of the economy in some years). That seems to be changing. Despite proximity and ease of logistics, Toyota Hilux VIGO vehicles produced in Thailand are no longer the only Hiluxes on Lao roads. South African? or are they Chinese manufactured Hiluxes, branded simply as Toyota Hilux and NOT VIGO are now commonplace in Vientiane. About 1 in 2 of the new Hiluxes on the roads in Vientiane is now a non-Thai produced Hilux. It appears to be the same with Ford Rangers.

Mahindra, an Indian manufacturer whose products I have not seen anywhere in Thailand are breaking into the Lao market big time. Dealerships are springing up and their range of pickups and SUVs are quite popular. Chinese makes such as Great Wall, BYD and QQ are quite popular in Laos too. With no local industry to protect, Laos' automotive market is much more fragmented than Thailand's where you see few "fancy" cars as my Vietnamese friend me last time he visited (even though he's been to Thailand about 10 times now). He's right though, due to Thailand's protectionist automotive market, everyone in Thailand drives what you're driving. There are literally only about 8-10 models produced by 5-6 manufacturers on the roads with less than 1% of the population driving something more interesting like say a Volvo, Skoda, BMW or Mercedes. Newly rich Lao drive Porsches, Maseratis, Range Rovers and Landcruisers, few of which you see in Thailand (they exist of course, but on an average day you probably won't see any unless you go to the ground floor of the Paragon car park where 20 of them will be parked. By comparison, all the fancy cars parked at Udon Thani's central shopping mall are Lao registered, making the Lao appear richer than their Thai counterparts!)

Thai seafood is no longer as popular as it used to be in Laos - Vietnamese seafood has started to replace Thai seafood in Vientiane markets. This may be a blessing in disguise as a long time Lao expat, who once lived in Thailand tells me (although he has fairly anti-Thai produce views anyway) that Thai seafood producers use steroids and formaline (this one I've heard about on the news here too) the latter for preservation all of which are illegal and highly dangerous, hence a good reason to steer clear of such produce if it's true and is widespread. Apparently Vietnamese seafood doesn't use any of these techniques. Indeed, I've never been disappointed by the taste of Vietnamese seafood.

So you believe by some miracle transformation the Thai worker becomes competent while they are working on assembling cars. I can't see that.

[expat888]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

You really have absolutely no idea about the automobile manufacturing industry in Thailand, do you ? The safety standards within these factories are on a par with those in the West and the wages, especially for those with a marketable skill are exceptionally good. Even the run of the mill production line operator has a fair salary, very good bonus and benefits that exceed anything they could get by working at the majority of local companies.

Holy crap what propaganda!! "...marketable skill are exceptionally good." Maybe we are talking about 2 different countries because that ain't Thailand.

Just the fact that a car was assembled in Thailand should trouble a potential buyer. I only hope none of the parts were made here.

Everything I have bought that was made in Thailand broke within 3 months.

Again, you have absolutely no idea what you are talking about. The auto manufacturing base here is massive (take a drive around Amata Nakorn, Eastern Seaboard or Amata City, to name but a few). Approximately 2 million automobiles were manufactured in Thailand last year, with about half of those being exported. Also, most of the parts for those automobiles were also made in Thailand.

I suppose they could be repaired when they reach their destination.

[hhfarang]

They'll be sorry when the next big flood hits and another 100,000 cars are ruined by water up to the windows.

[ThailandNoob]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

Welll it's not that easy to just pack up a new car production facility and go. But i think Great Wall (Chinese) halted plans to build mega factory here 300k units, Toyota also put new factory on hold already. Going forward they are going to look at Vietnam , Indonesia, etc. especially post 2015 asean.

A couple years back, some of the facilities were trashed in the floods. A lot of stock also bit the dust. They might have thought about packing it up about then. But, ...

The "New Car Buyers" incentive was, quite possibly, a big help in keeping the manufacturers here.

As someone who does business with several of these Japanese automakers, I can say that they saw the floods as a natural disaster, an exceptional event (an "act of God" if they were Christian). Whether or not the situation was made worse by bureaucratic bungling is besides the point, the Japanese didn't see it that way.

However, the current political drama (which they have seen as man-made and completely preventable) has shaken them a lot, a lot of them are starting to wonder what they got themselves into by investing in Thailand.

Shutting down a plant is very costly, however you can bet your bottom dollar that while this saga is ongoing, that none of the Japanese car makers will be investing more money into Thailand (remember that they don't like risk, and especially don't like conflict). Even if the whole political saga stopped tomorrow and went back to normal, it would take at least a year of calm before they even thought about expanding their operations here.

Sent from my IS11T using Thaivisa Connect Thailand mobile app

[Old Man River]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

NKK - Firstly I'd check the sources.

Then I'd look at the commitments of Japanese businesses in Thailand.

then I'd compare the situation here to Australia where they ARE pulling out.

then I'd ask where will they go?

There are options of course, but weighed against the drawbacks, I rethink it is a very unlikely scenario......mmaking mountains out of molehills.

I don't think you can compare OZ with Thailand. OZ has been a strong domestic market, plus a place to export out of. Thailand has been relatively strong for domestic pickup sales, but is a much smaller market for domestic sales than OZ. You locate in Thailand to export out of, and anything else is gravy.

Sent from my iPad using Thaivisa Connect Thailand

Edited April 1, 2014 by Old Man River

[Old Man River]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

Only that Toyota has said that if the unrest in Thailand doesn't settle down within 6 months they will shelf a massive development project and if the situation still exists in a year they will likely move elsewhere in Asi

isn't the unrest caused by politics ?

Toyota will look at either Cambodia or Viet Nam, as they are still close to their parts manufacturers in Thailand. Their preference is far and away to stay in Thailand, and it will take a lot to get them to move.

Sent from my iPad using Thaivisa Connect Thailand

[Kalbo]

I see, I hit a nerve in a few "Fatcats" ;-)

Mmm..you are telling me that companies like Merzedez are not exporting parts and/or vehicles to Europe from Thailand?

Or how about Motorcycle manufacturers such as Triumph, who produce here and then ship them to Britain?

I still need so see actual figures of wages and benefits for Thai Auto workers. (I am not talking upper management, I am talking wages of the average production worker in the Thai plants.

I love it when people try to justify their own greed.

No, Mercedes does not export back to Europe.

No, Triumph do not build a complete bike and ship it back to Britain.

More studying before posting. Google the facts.

Errrm, Yes Triumph do. And they also export to Europe, Japan and the US from Thailand too

[wilcopops]

The Japanese are used to the political machinations of Thailand. Whereas they might reduce or withhold investment for a while, I can,y see them pulling out in the long term. They have a staff and workforce that are trained to suit...they have tax incentivesvetc from the government and no future Thai government whoever is in power is going to make things difficult for an industry that employ an millions of people either directly or indirectlyindirectly.

[wilcopops]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

NKK - Firstly I'd check the sources.

Then I'd look at the commitments of Japanese businesses in Thailand.

then I'd compare the situation here to Australia where they ARE pulling out.

then I'd ask where will they go?

There are options of course, but weighed against the drawbacks, I rethink it is a very unlikely scenario......mmaking mountains out of molehills.

I don't think you can compare OZ with Thailand. OZ has been a strong domestic market, plus a place to export out of. Thailand has been relatively strong for domestic pickup sales, but is a much smaller market for domestic sales than OZ. You locate in Thailand to export out of, and anything else is gravy.

Sent from my iPad using Thaivisa Connect Thailand

What!?!?!?

[Old Man River]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

NKK - Firstly I'd check the sources.

Then I'd look at the commitments of Japanese businesses in Thailand.

then I'd compare the situation here to Australia where they ARE pulling out.

then I'd ask where will they go?

There are options of course, but weighed against the drawbacks, I rethink it is a very unlikely scenario......mmaking mountains out of molehills.

I don't think you can compare OZ with Thailand. OZ has been a strong domestic market, plus a place to export out of. Thailand has been relatively strong for domestic pickup sales, but is a much smaller market for domestic sales than OZ. You locate in Thailand to export out of, and anything else is gravy.

Sent from my iPad using Thaivisa Connect Thailand

What!?!?!?

what?? You are saying Australia is a smaller domestic market than Thailand??

http://www.fool.com/investing/general/2014/02/14/can-toyota-survive-the-thai-crisis.aspx

The article above doesn't say much about Australia other than 20% of the cars made by Toyota in Thailand are sold in Australia and 5% of the cars manufactured anywhere by Toyota are sold in Thailand. For Toyota, Thailand is a much smaller market. Yes they are concerned that Thai politics may effect their just in time delivery policy (Nissan apparently is less concerned), but their parts manufacturers are located in Thailand. It is a lot to move to Indonesia.

My experience with long term investors is that they complain about short term politics, but invest for the long haul. Maybe Toyota is different, which would explain the strong backlash from Australians on Toyota's decision to pull out of OZ.

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[wilcopops]

How does this balance the warning from some Japanese companies they'll be gone within a year if the politics don't settle down ?

They produce in the Eastern Seaboard and ship out of Laem Chabang. What does politics have to do with this?

Sent from my iPad using Thaivisa Connect Thailand

NKK - Firstly I'd check the sources.

Then I'd look at the commitments of Japanese businesses in Thailand.

then I'd compare the situation here to Australia where they ARE pulling out.

then I'd ask where will they go?

There are options of course, but weighed against the drawbacks, I rethink it is a very unlikely scenario......mmaking mountains out of molehills.

I don't think you can compare OZ with Thailand. OZ has been a strong domestic market, plus a place to export out of. Thailand has been relatively strong for domestic pickup sales, but is a much smaller market for domestic sales than OZ. You locate in Thailand to export out of, and anything else is gravy.

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What!?!?!?

what?? You are saying Australia is a smaller domestic market than Thailand??

http://www.fool.com/investing/general/2014/02/14/can-toyota-survive-the-thai-crisis.aspx

The article above doesn't say much about Australia other than 20% of the cars made by Toyota in Thailand are sold in Australia and 5% of the cars manufactured anywhere by Toyota are sold in Thailand. For Toyota, Thailand is a much smaller market. Yes they are concerned that Thai politics may effect their just in time delivery policy (Nissan apparently is less concerned), but their parts manufacturers are located in Thailand. It is a lot to move to Indonesia.

My experience with long term investors is that they complain about short term politics, but invest for the long haul. Maybe Toyota is different, which would explain the strong backlash from Australians on Toyota's decision to pull out of OZ.

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At present Australia and Thailand buy about the same number of units - Oz is slightly less.

However as I pointed out earlier, Thailand with a population over 3 times that of Australia is still in the equipment phase....there is room, if car ownership parallels Australia's, for the Thai market to be triple that in Oz.

the Thai industry is MUCH bigger than Australia's - about 7 times the number of units produced.

toyota have bee in Thailand since the 1960s - so they aren't likely to be surprised by the current political situation here.

If you look at plans for the future - you need to look further than Toyota.

The top selling pickup in the world was (maybe still is) the Nissan. They are starting a co-production facility with Mitsubishi in Laem Chabang for this - why? It's on the harbour and easy for shipping.

Furthermore the industry in Thailand is developing into a predominantly export manufacturer...this is something Oz patently failed to do despite 60 years of car production.

don't forget Holden Ford and Toyota are not the first to pull to of Oz, they are the LAST, many manufacturers have tried and failed in Oz in the last 50 years.

[wilcopops]

OMR -

At present Australia and Thailand buy about the same number of units - Oz is slightly less.

However as I pointed out earlier, Thailand with a population over 3 times that of Australia is still in the equipment phase....there is room, if car ownership parallels Australia's, for the Thai market to be triple that in Oz.

the Thai industry is MUCH bigger than Australia's - about 7 times the number of units produced.

toyota have bee in Thailand since the 1960s - so they aren't likely to be surprised by the current political situation here.

If you look at plans for the future - you need to look further than Toyota.

The top selling pickup in the world was (maybe still is) the Nissan. They are starting a co-production facility with Mitsubishi in Laem Chabang for this - why? It's on the harbour and ease of shipping.

Furthermore the industry in Thailand is developing into a predominantly export manufacturer...this is something Oz patently failed to do despite 60 years of car production.

don't forget Holden Ford and Toyota are not the first to pull to of Oz, they are the LAST, many manufacturers have tried and failed in Oz in the last 50 years.

Despite the demise of the home industry, Australia will still need cars etc., and they need to be built somewhere...including the larger vehicles that are unique to Oz. I suspect that manufacturers may look at China, Vietnam, Cambodia etc but come on! they are with the exception of China politically more unstable than Thailand!. Thailand has the skills a government ready to do deals - my guess is they are licking their lips at the prospect of a whole new wave of business supplying the Australian market.

[baneko]

My Prerunner was much cheaper than I could get in the UK. Obviously because built and made in Thailand.

Thai auto industry is booming. Go to Laem Chabang and watch the trucks being loaded onto ships or go to Amata Nakhon. Very busy.

They are well paid but nowhere near western or australian wages.

Safety I'm unsure! I have worked in Bowin and standards in the Pipe Mill were below the UK.

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[Tomtomtom69]

Now you can see why Detroit is a Ghost Town. Greedy, Western Manufacturers are all coming to Thailand and other developing Countries, in order to take advantage of slave wages and poor worker safety standards, in order to make more profits.

Cheaper labour, but cars are still more expensive in Thailand than say Australia.

True - but that's largely a result of Australian government policy to remove duties and tariffs, such that imported models became so cheap that they undercut the price of the locally produced Australian models. Not only that, but consumers' increasing preferences for smaller, more fuel-efficient models that the Australian manufacturers (or their bosses) never decided to manufacture and an unfair Thai-Australia FTA, where Thai exporters are able to export Thai made Japanese vehicles to Australia at 0% duty (prior to the agreement I think the duties were only 5% or something fairly low like that) whereas Australian imported cars are still subject to up to 300% duties, even if the "import duties on Australian cars" "disappeared". So as you can see all these factors resulted in the Australian industry dying and Thailand's industry continuing to show strength mainly because of Thailand's highly protective automotive market policies. If Thailand followed Australia's lead, I'm quite sure that the Thai automobile industry would become unviable too - and exactly because of this, don't expect the 300% duties on foreign imported automobiles (and similarly quite high duties on CKD vehicles built in Thailand using imported parts such as some Mercedes models) to be removed anytime soon - lowered somewhat, perhaps, but eliminated entirely, not for years or decades, I'd say.

I can't explain why locally produced Thai cars for the Thai market are more expensive than their equivalents in Australia, North America and other countries though, other than the Thai government taxes them higher in order to prevent too many people owning a car and clogging up the roads even further? You might say this contradicts the government's previous policy relating to the tax rebate scheme in 2012, but I think the extra income for the government is both lucrative and a way of slowing down unsustainable growth in the automotive market, which would lead to even more congested roads.

Australia's population is 1/3 that of Thailand and has more than 15 times the land area. That means it has at least 45 times fewer people per sq km than Thailand and additionally, in the cities there is far more road space for vehicles than in Thailand - in Bangkok just 8% of city area is dedicated to roads yet 25% is required. I haven't seen the statistics for Sydney for example, but I'm quite sure it's around 25% - there are simply far more roads, including both main roads, connecting roads and residential streets, than in Bangkok. I'd be quite happy for the authorities to purchase half of say Nana, bulldoze the sh**hole and build some major connecting roads through there (perhaps also another expressway link or a skytrain-airport link connection), leaving some space for upper class hotels and/or condominiums, but unfortunately pimps, drug dealers and sleaziness are likely to remain in that area for now. In Thailand, while road widening is common in the provinces and various expressway "missing links" have been built over the years, I see absolutely no evidence of new road building. Of course, most new road construction would take place on the outskirts of the city where there's more room. I live on the outskirts of Bangkok, but nothing has changed - no new roads. Only at most, the addition of a new lane in each direction for a few km. That's a bandaid solution, not a real solution.

What you mean is the Aussie industry could not compete without protectionist duties that made normal cars so much better value.

Correct - and I think that's also a factor that explains why many other countries are currently using such measures to protect their own automotive industry. However, western governments, especially the Australian government have long spouted free trade and therefore protective duties are seen as being a barrier to free trade, with measures taken years ago to lower them and eventually eliminate them. It's therefore unfortunate, but not really surprising that opening up their economy to imported cars would have the effect of eventually killing the local industry along with all the other factors that don't help, like a high Australian dollar, high wages, small export market, relatively low population (which by itself wouldn't be an issue, but is when combined with these other factors) and the aforementioned consumer preferences for smaller vehicles not produced locally etc.

Edited April 1, 2014 by Tomtomtom69

[chooka]

OMR -

At present Australia and Thailand buy about the same number of units - Oz is slightly less.

However as I pointed out earlier, Thailand with a population over 3 times that of Australia is still in the equipment phase....there is room, if car ownership parallels Australia's, for the Thai market to be triple that in Oz.

the Thai industry is MUCH bigger than Australia's - about 7 times the number of units produced.

toyota have bee in Thailand since the 1960s - so they aren't likely to be surprised by the current political situation here.

If you look at plans for the future - you need to look further than Toyota.

The top selling pickup in the world was (maybe still is) the Nissan. They are starting a co-production facility with Mitsubishi in Laem Chabang for this - why? It's on the harbour and ease of shipping.

Furthermore the industry in Thailand is developing into a predominantly export manufacturer...this is something Oz patently failed to do despite 60 years of car production.

don't forget Holden Ford and Toyota are not the first to pull to of Oz, they are the LAST, many manufacturers have tried and failed in Oz in the last 50 years.

Despite the demise of the home industry, Australia will still need cars etc., and they need to be built somewhere...including the larger vehicles that are unique to Oz. I suspect that manufacturers may look at China, Vietnam, Cambodia etc but come on! they are with the exception of China politically more unstable than Thailand!. Thailand has the skills a government ready to do deals - my guess is they are licking their lips at the prospect of a whole new wave of business supplying the Australian market.

Yea and Bathurst will consist of a couple of vios's yapping around the track. No more Holden and Ford rivalry just a couple of little gutless vios's.

[Old Man River]

OMR -

At present Australia and Thailand buy about the same number of units - Oz is slightly less.

However as I pointed out earlier, Thailand with a population over 3 times that of Australia is still in the equipment phase....there is room, if car ownership parallels Australia's, for the Thai market to be triple that in Oz.

the Thai industry is MUCH bigger than Australia's - about 7 times the number of units produced.

toyota have bee in Thailand since the 1960s - so they aren't likely to be surprised by the current political situation here.

If you look at plans for the future - you need to look further than Toyota.

The top selling pickup in the world was (maybe still is) the Nissan. They are starting a co-production facility with Mitsubishi in Laem Chabang for this - why? It's on the harbour and ease of shipping.

Furthermore the industry in Thailand is developing into a predominantly export manufacturer...this is something Oz patently failed to do despite 60 years of car production.

don't forget Holden Ford and Toyota are not the first to pull to of Oz, they are the LAST, many manufacturers have tried and failed in Oz in the last 50 years.

Despite the demise of the home industry, Australia will still need cars etc., and they need to be built somewhere...including the larger vehicles that are unique to Oz. I suspect that manufacturers may look at China, Vietnam, Cambodia etc but come on! they are with the exception of China politically more unstable than Thailand!. Thailand has the skills a government ready to do deals - my guess is they are licking their lips at the prospect of a whole new wave of business supplying the Australian market.

I think that we, actually, very much agree. Perhaps you misinterpreted my original comment, or I wasn't clear, but in any event it seems we have had similar experiences, although, admittedly, I did think the local domestic market in OZ was bigger than Thailand.

I have been here for many years and have heard the comments vis a vis several products that Thailand should be this and could be that, but it doesn't happen. At the end of the day, the Eastern Seaboard is chosen due to it's proximity to Laem Chabang and it's deep water port for export. Local politics doesn't affect this. Thai politics may impact the country's inability to become the local market many project, but a lot of products manufactured/assembled in Thailand ultimately end up for export. Still of great value to Thailand.

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